Oversecured creditor sought payment of its attorney's fees under 11 U.S.C. § 506(b), which allows such payment to oversecured creditors, as provided by their agreement with the debtor. The court determined that § 506(b) was an exception to the general "American rule" that parties must bear their own attorney's fees, and that such exceptions must be strictly construed. Creditor failed to provide a copy of its agreement with its proof of claim, as required by Bankruptcy Rule 3001, and again failed to provide it in response to debtor's objection to its attorney's fees claim. Without the agreement in the record, the court found that the application for attorney's fees under § 506(b) must be disallowed.

On requests for rehearing, the court withdrew its previous decision in this matter [112.pdf] based on its finding that movants had not technically been accorded procedural due process with respect to the issue of applicability of the Packers and Stockyards Act to the claims of creditor sheep producers. The court first considered whether any of the sheep producers' claims were incurred postpetition, based on its conclusion that payment to the sheep producers became due at the time and place of delivery of the sheep. Under this guideline, the court used the delivery date to separate clearly prepetition deliveries from postpetition deliveries, which were entitled to priority as administrative expenses if they were incurred for the actual and necessary costs of preserving the bankruptcy estate. The court then considered deliveries that occurred on the same day the petition was filed, finding that the sheep were "delivered" when they were weighed in the trailer and a weigh ticket was created. The court then divided the "day of" transactions into those that were incurred prior to and after the filing of the petition at 1:56 p.m. MDT. The court next considered which postpetition claims were "actual and necessary costs," concluding that delivery of goods should be given the same priority as provision of services. Therefore, all postpetition sheep deliveries were entitled to administrative priority. Finally, the court ruled that administrative claimants were not entitled to interest on their claims, but that the unsecured, prepetition claimants might be entitled to interest, under state law, up to the date of the petition filing.

Individual debtor brothers made several transfers to and from jointly owned corporate debtor, including transfer of each of their respective residences to the corporation, and mortgages and promissory notes from the corporation to themselves. The parties also executed leases that allowed each brother to retain their residence, subject to payment of monthly "rent." In bankruptcy, trustee sought determinations of (1) whether brothers' claim that their rent payments were offset by a debt owed to them; and (2) whether brothers were required to assume or reject their leases. The court denied brothers' claimed offset of patent royalties owed them by the corporation, as they had transferred their interests in those royalties to family partnerships and, therefore, there was no mutuality, as required for offset. Brothers were ordered to either assume or reject their leases by a date certain and, if they chose to assume, pay the entire monthly rent accrued since the filing of the corporation's petition in order to cure.

Bank was the assignee of lessor's interest in a variety of rapidly depreciating personal property leased to chapter 11 debtor, which were used in connection with debtor's timeshare business. Bank sought to compel debtor to assume or reject the leases, and to provide bank with adequate protection for the period from the petition filing date to the date debtor either assumed or rejected the leases. The court held that Congress intended to provide adequate protection for secured creditors only, and not for lessors, and denied bank's requested relief.